Proposed Bill Could Make Electric Cars More Affordable
In President Obama’s State of the Union address, he addressed the future of electric cars stating, “With more research and incentives, we can break our dependence on oil with biofuels, and become the first country to have a million electric vehicles on the road by 2015”. But before that can happen, some things have to change and that’s what the new proposed bill aims to fix.
The first is to expand the vehicles included in the tax deduction which the proposal would then include Chevy Volt, Nissan Leaf, Tesla Roadster, CODA Sedan and the Wheego LiFe. Secondly, the number of units per manufacturer eligible for the tax credit would need to be expanded from 200,000 to 500,000. With the cost of electric vehicles the way it is, most consumers wouldn’t look at the electric vehicle option unless they had the $7500 tax credit to go with it. If that tax break is removed, the probability of purchase is greatly reduced making it less profitable for the manufacturer, and a lot less probable that it will find a sustainable market.
The proposed bill addresses both of those issues, but Obama looks to be be putting the pedal to the metal and if his plans come to fruition, the bill could find a fast track. Obama’s plans include $10 million in grants to each of 30 US cities to install electric charging stations, expansion in research for electric batteries and drivetrain technology, and a 30% increase to federal grants related to the technology.
The bill’s proposers are Michigan congressman Sander Levin and Carl Levin and for obvious reasons, their state stands to benefit the most from this being pushed through. And so far, it looks like it will be granted without much resistance. “Green vehicles represent the vanguard of automotive innovation, but they have to be economical for consumers and profitable for manufacturers. Raising the cap on this credit will help carmakers reach the demand and production scale necessary for long-term viability.” Sander Levin said in a statement. However, there is still question that people are planning on purchasing them even at the price point that the vehicles are currently going for. Let’s hope that the electric and hybrid vehicle market gets a good foothold, because progress means competition and competition means better pricing for the public which translates into wider adoption and that’s truly what they need to succeed.
Jim Ellis Automotive Blog 